Impact of the EU-UK Trade Agreement on Caribbean Exporters

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The Impact of the EU-UK Trade andCo-operation Agreement on Caribbean Exporters

Such amendments should also allow the simple processing or repackaging of products without any loss of duty-free access when re- exported, where such products can be imported directly on a duty-free basis to EU and UK markets. This issue needs to be taken up in the relevant consultative committee structures set up under the recently concluded CARIFORUM-UK Continuity Agreement and the longer-estab- lished Caribbean–EU EPA. At the operational level, the core issue relates to the unilateral adoption by the UK and the EU, respectively, of simplified procedures for the verification of the initial ‘originating status’ of Caribbean ACP products. This should apply to both products re-exported in an unaltered state across an EU–GB border and products used as inputs in EU or UK products where the use of such products should be allowed provided the exporting country enjoys DFQF access to both GB and EU markets. This should include prod- ucts undergoing simple processing (e.g. raw to refined sugar) or repackaging operations (bulk rum to bottled rum) prior to ‘re-export’ across an EU–GB customs and regulatory border. At the core of the simplification of country- of-origin verification process needs to be an acceptance of other existing country-specific trade documentation, as proof of origin for the purpose of claiming tariff preferences. Probably the simplest sector where existing country-specific trade documentation is rou- tinely accepted by both UK and EU authorities is the fruit and vegetable sector. Here, for the vast majority of products, country-specific phy- tosanitary certificates are routinely accepted by national plant health authorities as proof of the country of production (or country of origin). There would appear to be no reason why such phytosanitary certification should not also be used as ‘proof of country of origin’ by national customs authorities for the purpose of grant- ing tariff preferences under DFQF access trade arrangements even where such products are shipped along triangular supply chains outside of customs supervision. This being noted, for the Caribbean main fruit export, bananas, this option is not avail- able, since neither the EU nor the GB requires phytosanitary certification for bananas to enter its market. As a consequence, from a Caribbean perspective, it is important that alternative

options for simply verifying the country of origin are set in place, based on routine trade documentation. For organic bananas, this could include the organic certification documentation issued in the country of origin. For sea fisheries products, sustainable fishing certification could be used as proof of country of origin, as could Fairtrade certification. Where these options are not avail- able, other simple systems could be set up using other forms of routine trade documentation (purchase contracts, supplier invoices or other standard officially recognised commercial trade documentation). These policy measures would bring benefits to Caribbean exporters shipping along triangu- lar supply chains in the: • Sugar sector – where the issue of refin- ing Caribbean raw cane sugar and the use of imported cane sugar in high sugar con- tent value-added food and drink products would then fall away for products destined for both EU and UK markets; • Fruit and vegetable sector – where products are simply re-exported across an EU–GB border; • Rum sector – where bottling operations for cross-border delivery and the simple re- export of bottled rum broken down from larger consignment would fall away; • Fisheries sector – where MFN tariff issues on simple re-exports would fall away; • Cocoa sector – where the main gain would be in simplifying the delivery of ‘fine cocoa’ to end users along triangular supply chains. 4.1.1 Phytosanitary import control issues Phytosanitary re-export certificates There is a need to establish simplified systems for the issuing of phytosanitary re-export cer- tificates, with timeframes consistent with the needs of short shelf-life product triangular sup- ply chains. This requires: • A clear designation of the officials respon- sible for issuing phytosanitary re-export certificates, with appropriate staffing levels where physical verification inspections are deemed to be required; • A clear specification of the timeframes within which phytosanitary re-export cer- tificates should be issued;